NEW REPORT | Global Risks for Infrastructure – The Climate Challenge

GIIA, in partnership with Marsh & McLennan, is pleased to release the second in a three part analysis of global risks for infrastructure investors. Looking at the Climate Challenge, this report discusses the specific risks to infrastructure investors under each of the key risk categories outlined by the Task Force on Climate-related Financial Disclosures, as well as crucial levers for achieving climate resilience at both the portfolio and asset level for the infrastructure sector.

Click the image below to read Global Risks for Infrastructure – The Climate Challenge

Physical risks related to climate change are becoming a crucial risk category for infrastructure owners and operators. Natural disasters are already a leading cause of infrastructure disruptions in high-income nations, and climate change is expected to exacerbate these disruptions. In addition, increased urbanisation is heightening concentration of infrastructure assets in high risk areas.

Applying the three mutually reinforcing levers discussed in this report can provide infrastructure investors with a launchpad for developing a dynamic and future-ready climate resilience strategy.

 

The first instalment of this series illustrated the risk landscape for infrastructure with the release of the 2020 Global Risks for Infrastructure Map while the upcoming final instalment will explore the impact of transformative and disruptive technological innovations on the infrastructure sector, with an expected release in Q4 2020.

UK MP’s attitudes to infrastructure investment

A new Ipsos MORI survey into MP’s attitudes towards UK infrastructure reinforces the need for increased investment and the important role of the private sector in its delivery, echoing much of the sentiment expressed in the 2019 GIIA/Ipsos MORI Global Infrastructure Index.

All UK MPs interviewed agreed that investing in infrastructure is vital to Britain’s future economic growth, a view shared by 80% of the public. There is also a strong belief that Britain is not doing enough to meet its infrastructure needs, highlighting an overall feeling of dissatisfaction with Britain’s current infrastructure: 22% of MPs rate it positively compared to 36% of the public.

On the question of private investment providing the infrastructure Britain needs, both MPs and the public showed high levels of support with more than 90% of MPs saying they were comfortable with private investment, while the general public responded favourably by a 4 to 1 margin compared to those who were opposed to it.

Views diverge on the sectors that should be prioritised for investment. The Global Infrastructure Index shows that 40% of the public think solar energy infrastructure is an investment priority, followed by flood defences and rail, whereas MPs prioritise digital infrastructure relatively more highly than the public (57% compared to 25%), perhaps indicative of the need for elected representatives to better understand the priorities of their constituents which seem to be more heavily focussed on green, sustainable investments.

At GIIA, we continue to maintain a strategic dialogue with Government on behalf of our members on the role of private investment in infrastructure, including through the UK Investable Infrastructure Senior Leadership Group as well as through key channels across DIT, BEIS and HM Treasury where we are actively informing long term policy development and advocating for the role of private investment to deliver the infrastructure that communities rely on today, and that future generations will need tomorrow.

Results of the 2020 Global Infrastructure Index, produced in partnership between GIIA and Ipsos MORI, will be published in the Autumn.

ELII – Adebayo Ogunlesi talk

GIIA’s Emerging Leaders in Infrastructure Investment network were pleased to hold their inaugural meeting last week, welcoming Founder and Managing Partner of Global Infrastructure Partners Mr Adebayo Ogunlesi to speak about his own career and take questions from members.

Attendees were able to hear first-hand about the career path that Bayo took, after initially practising as a lawyer before moving to Credit Suisse First Boston, rising to Head of Investment Banking and finally founding GIP in 2006.

During the webinar, ELII members asked a number of questions about the infrastructure asset class, managing risk, the challenges of fundraising for a first time fund and the impact of Covid-19 on the sector.

GIIA’s ELII network is a member-led organisation aimed at young professionals who are working within the infrastructure investment sector.

For more information about ELII please join the LinkedIn group or contact Joe Robinson at jrobinson@giia.net